All the data are collected in this industry Analysis are from company executives committees, websites of relevant fields companies, and some from secondary data (data that have been compiled and published earlier) and trade organizations.
Sanitary ware and ceramic industry in European union are very much oligopolistic, products are not very unique to one another, few companies holding patents for some technologies, most of the companies have a combination of similar suppliers sharing the raw materials. All the products considered in this report are from developing countries and those are important to suppliers.The sanitary ware manufacture companies use Cr(IV) for electroplating of the products for the purpose of long-lasting, high-durability and shiny looks.Since there is no alternative to Cr(IV) for electroplating which produces high quality and performance products for the EU consumers.Adopting for another alternative could result in a high reduction in the supply of products.Some countries government has put some restriction on the manufacturing process of Cr(IV), which emits airborne and increase surface tension.
The product group used in this analysis are of following groups:-
· Sanitaryware made up of plastic such lavatory pans, seats and covers.
· Ceramic sanitary ware sinks, washing basin.
· Sanitary ware made up of iron or steel such shower basin and wash basin
· Unglazed ceramic flags and paving, grate and wall tiles.
· Glazed ceramic flags and paving, grate and wall tiles.
The sanitary ware and ceramic market in European union have reached a stage of maturity. The demands of this product primarily depend on the growth of industrial sector. The forecast for European construction sector predicts it will grow at the rate of 2.5 % annually during the period 2001 to 2003. According to Eurostat data, the total value of the European Union in demand and supply of sanitary ware and ceramic products amount to US$ 8,494 million (EUR 9,232 million) in 2000. The demand for sanitary ware is US$ 3,800 million (€ 4,130 million) and demand for ceramic products is US$ 4,694 million (€ 5,102 million). The largest markets for sanitary ware and ceramic products in the EU are Spain, Germany, Italy, France and the United Kingdom.
The quality of production is different across Europe, many factories are established in order to serve the local markets although more of the national market share of the sanitary production is held by Italy, Germany, United Kingdom, Spain, and France.The European market is getting highly competitive internationally due to recent mergers and acquisitions and some large companies taking over the market.For example, Grohe merges with Japanese Lixil group.
The overall European market for sanitary ware is strong internationally.The data of 1997 shows only 4.6 percentage consumer is satisfied with import from with third countries.In the year 2000 demands of the sanitary ware and ceramic Products reached the volume of 6,494 thousand tonnes which amounted to $4,460 million or € 4,848 million(Ref currency chart).The countries with high demands for sanitary and ceramic products in the year 1999 are Germany(24%) France(20%) united kingdom(14%) Belgium(6%) Austria (6%) and Netherland with (5%).The demands of sanitaryware and ceramic products in the EU is just over 40%.In the year 1998, demand for the products was decreased by 5% in value but increased in volume by 20%, more than 25% of the suppliers are from outside of the EU and which consists 9% from the developing countries.the most demandable products were plastic sanitaryware 40%, ceramic products 38% and 22% for sanitary products made up of iron or steel.
In 2000, the demands of EU for sanitary ware and ceramic products from developing countries was close to US$ 412 million (€ 448 million) with a volume of 701 thousand tonnes. Sanitary ware represented the demand of 57 % of the total value, and remaining 43 % represents the demand for other ceramic products. The share of EU imports from developing countries differs across the product groups of sanitary ware and ceramic tiles. In the period 1998-2000, imports from developing countries of plastic sanitary decreased by 15 percent in value and increased by 7 percent in volume, imports of ceramic sanitary increased by respectively 2 and 27 percent, imports of iron/steel sanitary components increased by 4 and 12 percent, imports of glazed ceramic tiles decreased by 21 and 7 percent and imports of unglazed tiles decreased by 20 percent in value, and increased by 7 percent in volume.
In 2000 the EU Members supplied sanitaryware and ceramic products around 13,663 thousand tonnes of sanitary ware and ceramic tiles representing a total value of US$ 7,692 million or € 8,360 million.While the value of these supplies declined by 7 percent since 1998, volume rose by 9 percent. Over the last ten years, the volume of the EU supply almost doubled. While its value increased by only 50 percent. About a third of the total value of EU supply of sanitary ware and ceramic tiles in 2000, consisted of sanitaryware, the other two-thirds consisted of ceramic products.The leading suppliers of sanitary ware and ceramic tiles were Italy (47%), Spain (25%), Germany (10%), France (5%) and Portugal (3%).The most important EU export product group was glazed ceramic flags and paving, hearth or wall tiles. In 2000 supplies of these products amounted to 55 percent of total EU supply of sanitary ware and ceramic tiles, mainly from Italy and Spain.
Sanitary ware is a division of ceramic wares. It is proven that ceramic sanitaryware wares are cost-effective and good for long run. Sanitary wares can withstand more than 400 kg load and excellent resistance to chemical attacks. Sanitaryware items can be easily cleaned because of its glossy surface properties
2.1 source Definition
sanitaryware.org Sanitaryware is a vitreous china body fired above 1200 0 C to get the required sanitary
model to use for the domestic and industrial purpose.
www.merriam-webster.com ceramic plumbing fixtures (such as sinks, lavatories, or toilet bowls)
The European Union (EU) is the current name for the former European Community. Since 1 January 1995, the EU currently comprises of 28 Member States. Negotiations are in progress with a number of candidate other member states, many of whom already have extensive trade and cooperation agreements with the EU. It is envisaged that many of these countries will become members in coming years.
The EU has developed an internal single market through a standardized system of laws that applies to all the member states. In 2000, the size of the EU population totaled 376.4 million. Total GDP in 2001 equaled US$ 7,894.5 (€ 8,580 billion) billion at current prices, while the average GDP per capita (at current exchange rates)amounted to US$ 20,742 (€ 22,545)in 2000 (OECD,2002)The most important aspects of the process of unification which affects trade and harmonization of rules among EU countries.As unification allows free movement capital, goods, service and people, internal border shared by EU countries are removed.Members states can move freely in other member states without restrictions.
On 1 January 1999, the euro (€) became the legal currency within twelve member states: Austria, Belgium, Finland, France, Germany, Greece, Italy, Ireland, Luxembourg, The Netherlands, Spain, and Portugal. Circulation of euro coins and banknotes began on 1 January 2002 and these will gradually replace national currency notes and coins, which must be withdrawn by 1 July 2002.The most recent Eurostat trade statistics quoted in this analysis are from the year 2000. On 1 January 1999, statistical and contractual values in ECU were converted into Euros on a 1:1 exchange rate.The € / US$ exchange rate currently (March 2002)stands at US$ 0.88 for one Euro.In this industry analysis, the US$ is the basic currency unit used to indicate value. Values for dates after 1 January 1999 are also expressed in Euro.
3.1 Market size of Sanitaryware and ceramic products in EU
The survey emphasizes the specific situation of five European countries. These countries are the Netherlands, Belgium, the United Kingdom, Germany, and France. The main two reasons of the selection of these specific countries are that they are the top five countries with the most demand of sanitary ware and ceramic products in the EU and that these countries have the largest sales in the Do It Yourself (DIY) segment.
3.1.1 Ceramic products
Consumption of ceramic products are scarce and scattered across resources. Sources are sometimes contradictory hence the picture presented in this document must be treated with caution. Overall, the European ceramic tile industry has a strong control of its internal market. Data for 2000 indicate that only 5.3 percent of European demand is satisfied by supply from third countries. The largest markets in Europe are Germany, The United Kingdom, and the southern European countries.Eurostat data on the value of demand and supply in 2000 are presented in the table below. These data should be treated with caution since the presented (apparent) demand levels are derived from production and trade data. Moreover, as not all trade within the EU is registered, national consumption is overestimated in those cases where a country sells substantial parts of its production in relatively small quantities within the EU. According to Eurostat data, total value EU demand in 2000 of sanitary ware and ceramic tiles amounted to US$ 8,494 million (€ 9,232 million).demand of ceramic products amounts to US$ 4,694 million (€ 5,102million). The largest markets for ceramic products in the EU are Germany, France, Spain, United Kingdom and Italy.
3.1.2 Sanitary ware products
Consumption data of sanitary ware are similarly scarce and scattered across sources. The largest markets in Europe for sanitary ware are Germany, Italy, the United Kingdom, France and Spain. Eurostat data on consumption for the year 2000 are presented in the table below. Again, the data should be treated with caution since the presented (apparent) consumption levels are derived from production data and trade data.Moreover, as not all
trade within the EU is registered, national consumption is overestimated in those cases where a country sells substantial parts of its production in relatively small quantities within the EU. According to Eurostat data, consumption of sanitary ware amounted to US$ 3,800 million (€ 4,130 million). The largest markets for ceramic tiles in the EU are Germany, Italy, France, the United Kingdom, Spain and the Netherlands.
The most important developing countries as suppliers of EU imports, after Turkey (US$ 176 million,€ 191 million), are Egypt (US$ 47 million,€ 51 million), China (US$ 38 million, € 41 million),Morocco (US$ 19 million, € 21 million), Slovenia(US$ 19 million, € 21 million), Thailand(US$ 18 million, € 20 million) and Indonesia(US$ 17 million, € 18 million).
3.1.3 Some of the factor’s on which sales depends:
The market for sanitary ware and ceramic products has reached a stage of market maturity with household penetration at saturation level.The demand for Sanitary ware and ceramic products are influenced by the factors described below:
General economic situation
The economic situation in the EU declined since the last quarter of 2001. Economic growth is expected to increase by 1 percent, whereas inflation is expected to increase by 2 percent in 2002. Economic growth is expected to rise again to 3 percent in 2003.
In spite of the (slightly) higher than expected inflation,private consumption is expected to remain buoyant as a result of declining unemployment, and tax cuts on private incomes. A number of new houses built and the number of renovation activities Birth-rates within the EU are generally low, and to a greater or lesser extent, population growth in Europe depends on the outcome of immigration policies. Nonetheless, the increasing dissolution of marriages, while causing a reduction in the average number of inhabitants per house, has an influence on the total demand for the number of housing units.The number of house owners in the EU is increasing but remains relatively low in Germany, the United Kingdom, France and the Netherlands.According to the European Construction Industry 2001(ECI 2001) Report, the EU building industry generated business worth € 852 billion (excluding VAT). The new residential market (€ 202 billion) continued to dominate followed by the residential repair and maintenance market (€ 190 billion).The market for new non-residential buildings amounted to € 154 billion and the market for non-residential repair and maintenance amounted to € 103 billion. The economic recovery between 1999 and 2000, was reflected in the house building sub-sector (increase by 2.9 percent in value in 2000), but is expected to slowdown to a 1 percent increase in 2001.The favourable economic climate resulted in a growth rate around 3 percent between 1999 and 2000 for both public and private non-residential buildings.Although estimates for 2001 and 2002 were positive in the Report, the effects of the last quarter of 2001 may show some adverse results. The rehabilitation and maintenance sub-sector grew strongest between 1999-2000, reaching growth up to 3.3 percent, which, according to the ECI 2001 Report, is likely to slowdown to 1.3 percent in 2001. Forecasts by Euroconstruct for the European construction industry gives varying results per country, but the overall picture shows a slowdown in the annual growth between 2000 and 2001. (see table 2.1)
Trends in fashion
In ceramic products, there is a trend towards bigger tiles (i.e. as opposed to the usual sizes up to 150 x 150 mm). For industrial applications (such as chemical industry, food sector, garages, ware houses) where technical requirements dominate, formats of 20 x 20 are popular.Due to mechanical loads, these tiles are 15 – 20 mm thick. In reception rooms (living rooms, reception halls,etc.) the aesthetic aspects tend to dominate. In these markets the larger sizes (30 x 30 or larger) dominate.
For safety reasons, anti-slip tiles are increasingly usedin public buildings. For garden purposes, thick tiles(15-20 mm thick, format 20 x 20, are becomingincreasingly popular. These tiles are usually terra cottacoloured. Due to the increase in house ownership across Europe demand for more fashionable sanitary ware and ceramic tiles is increasing.
EU market difference
Bathrooms are normally “dry” environments in the UK as opposed to “wet” (i.e. tiled floors, walls etc.) on the Continent, which explains the low per capita consumption of ceramic tiles in the UK.Moreover bathing is more popular in the UK than Europe where showers are more prevalent. At the same time, northern Europeans tend to be taller than southern Europeans and therefore require larger baths.Concerning WC cisterns it should be noted that the UK uses the siphonic (valve-less) flush whereas the valve-flush is used throughout continental Europe.As for bidets, these are virtually non-existent in northern Europe and are more common in southern European countries. Typically, in Germany, the Netherlands and the Flemish part of Belgium light natural colours (so-called colonial style and Mediterranean style) tend to be popular.In the French speaking part of Belgium, France and also the UK there tends to be a preference for romantic pastel decorated bathrooms.
In this industry analysis of Sanitaryware and ceramic products in EU market gives a basic overview of its market trends.In this report describes research method is considered, which is to collect data from extensive market surveys and secondary data( data that has been compiled or published earlier).Some of the data collected are from company websites, trade organizations.Primary data is required when information in secondary data is not enough to complete the reports.Others methodology used for market research are:-
Sources of information are among others (statistical) databanks, newspapers, and magazines, market reports, (annual) reports from branch associations, products or catalogs from your competitors, and conversations with suppliers, specialists, colleagues and even competitors.